Pay gap grows for federal workers

Washington PostDecember 21, 2013 

— Government workers have fallen slightly further behind the private sector in pay, a federal advisory group reported last week.

The Federal Salary Council, a group of union officials and pay policy experts, said the average “pay gap” in favor of the private sector now stands at 35.4 percent, up from 34.6 percent last year and 26.3 percent in 2011.

According to the data, the gap is largest in the San Francisco and Washington-Baltimore areas, just above 49 percent, and lowest in a “catchall” area, 22.5 percent.

The pay-gap figure, based on data from the Bureau of Labor Statistics, involves employees paid under the largest of the government’s pay systems, the General Schedule for white-collar employees below the executive level. Pay rates under the GS system are locality-based, varying among 31 metropolitan areas, the entirety of Alaska and Hawaii and a catchall “rest of the U.S.” locality for everywhere else apart from foreign countries.

The council’s calculations represent the government’s official word on comparing federal and private-sector pay, a topic of long-running controversy.

Officials and union leaders have said that the federal workforce includes many highly skilled workers who would be making far more in the private sector.

Other studies using different methods and data have found federal employees ahead on average by varying amounts.

The conservative Heritage Foundation, for example, concluded in 2010 that federal employees are overpaid by 22 percent on average over comparably skilled private-sector workers, with the greatest advantage for lower-skilled employees.

James Sherk, a senior policy analyst in labor economics at Heritage who performed the study, said “virtually all the economic research on federal pay outside (the council’s) methodology consistently finds that the typical federal employee is making more than he or she would in the private sector.”

Instead of across-the-board increases, the government should pay according to market demand for skills and an individual’s job performance, Sherk said. “It doesn’t serve anyone well to have a system where pay is almost completely independent of what you do on the job.”

The BLS study was conducted while the federal workforce was in the middle of what turned out to be a three-year freeze on salaries. That freeze is expected to end in January.

Before that stretch, raises had been paid almost every year for decades, and union leaders said they hoped a government returning to annual raises would help stop federal pay slippage.

The budget agreement passed in the House and approved by the Senate last week is silent on a raise. That leaves room for President Barack Obama to issue an executive order for an across-the-board raise of 1 percent. However, language in separate legislation is needed to extend the raise to blue-collar employees, which could be done in a wrap-up spending bill to be considered in January.

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